Sweden`s Haldex Hydraulic Systems has bought a Canadian research and development company which has been working on electronically controlled hydraulic systems for mobile applications. Haldex says that products emerging from this work will remove many of the obstacles that vehicle manufacturers encounter with current electrohydraulic systems, especially in the terms of efficiency and noise.

The Canadian company, Micro Hydraulics, has been working in the fields of motion control and energy management for several years. Its technology for controlling hydraulic systems electronically has now reached the prototype stage. It has built compact, modular hydraulic components containing integrated electronics and software.

Haldex expects the first commercial products to reach the market in 2003 and expects to boost its business - currently worth around $100m a year ---- by 50% over a five-year period, and significantly more in the longer term. It reckons the global market for applications for the acquired technology is worth about $500m a year.

Haldex predicts that the Micro Hydraulics technology will offer users improved performance and stability at a lower cost than current electrohydraulic technology. Vehicles incorporating the technology will use less energy, will have lower lifetime costs, and will be safer and less tiring to operate, it suggests.

Haldex is making three "relatively modest" payments for Micro Hydraulics and its technology before 2005, but most of the purchase price will be in the form of sales-based royalty payments during the period 2003-2010.